“I Don’t Understand This Stuff” Is No Excuse: Nationalist Nonprofit Loses Tax Exemption

March 14, 2017; Los Angeles Times

Richard Spence’s “alt-right” National Policy Institute has lost its 501(c)(3) tax-exempt status as of May 15, 2016, for not filing its 990 forms with the IRS since 2012.

Among the policies for which the group advocates is a separate nation for white people. It is, according to its website, “dedicated to the heritage, identity, and future of people of European descent in the United States, and around the world.”

One of the nonprofit’s most high-profile events was a conference in D.C. last year where Spencer famously bellowed, “Hail Trump! Hail our people! Hail victory!” One would assume that the organization might wish to keep itself squeaky clean legally, but the group has not filed a 990 since 2012. Spencer has been running it since 2011.

Spencer said yesterday that an IRS error led him to believe his group was not required to file the 990s. “I don’t know what to say. I don’t want to make a comment because I don’t understand this stuff,” Spencer said in a telephone interview with the Los Angeles Times. “It’s a bit embarrassing, but it’s not good. We’ll figure it out.”

The error on the part of the IRS is as yet unconfirmed by the agency, but it had classified the group as not being required to file such forms until February, when it informed the group it was out of compliance.

Still, “They should have known that they should have been filing,” said Philip T. Hackney, a law professor and former IRS employee. “It’s very clear under the law that if you don’t file for three years, you lose your status.”

According to Elaine Lidholm, a spokeswoman for the Virginia Office of Charitable and Regulatory Programs, the National Policy Institute is also raising money in the state despite having no authorization to raise funds there. “They had sent in a registration form to us years ago, but it was incomplete and we requested additional information,” she wrote in an email to the L.A. Times. “We never heard back from them.”

There are also questions about whether the group flouted IRS rules on election-year activities by 501(c)(3) nonprofits, which prohibit “partisan comments in official organization publications or at official functions of the organization.” In September of last year, for instance, Spencer wrote, “I invite you to join us in the fight against Hillary Clinton, and the liberal agenda that’s haunted our country for generations.” Later, he declared that the organization had “willed Donald Trump into office.” But, as Hackney points out, at that time, the group wasn’t a charity anyway.—Ruth McCambridge